How American Express's CEO Learned to Lead 70,000 Employees

Will Yakowicz is a staff writer for Inc. magazine. He has reported from the West Bank and Moscow for Tablet Magazine; covered business, crime, and local politics for The Brooklyn Paper; and was the editor of Park Slope Patch. He lives in Brooklyn, New York.

Leading 70,000 employees is a tall order for anyone, but Kenneth Chenault, CEO of American Express, has a few ideas on exactly what it takes.

In the beginning of his 30-year career at American Express, Chenault took over the ready-to-fold merchant services department, which was a mail-order business that sold stereos, jewelry, and other goods. After two years, its revenues leapt from $150 million to $500 million.

"My view is often to take on the assignments that no one else wants, particularly early on in a career," Chenault told Knowledge@Wharton, University of Pennsylvania's business school blog. "Everyone wants to be in the glamorous part of a business. I wanted to learn."

It took three decades and a lot of learning, but Chenault made it to the top of the company. During a recent Wharton Leadership Lecture, Chenault said his leadership style is simple--he practices compassion, camaraderie, and connection with his employees. Below, read more on Chenault's pillars of leadership.

Compassion

Back in 1995, when Chenault was vice chairman of AmEx, he had to oversee the termination of 16,000 employees. This was one moment where his decisive-yet-kind leadership style made all the difference. He decided to break the news to the terminated employees 18 months before their last day. "You do what you can to be compassionate, even when the news is bad," Chenault says. He says true leaders are made during trying times, they are not situational: "The reputations of individual leaders are truly made or lost in times of crisis. You must gain loyalty by being decisive and compassionate. Otherwise, your reputation will vanish," he says.

Team Player

Chenault says that as CEO, he is always serving the main facets of his company: customers, employees, and shareholders. Every decision, he says, needs to be for the team. With compassion, he functions as a member of one team with the same goals. "The point is not to just be a nice person, but be effective, too," he says. "Sometimes being a team player is using what I call constructive confrontation. Be courteous, but push forward on what needs to be done."

Reach Down

When you're leading tens of thousands of employees, you know you cannot meet with every single one. But, Chenault says, that fact, that impossibility, cannot take over your actions. He says leadership doesn't start and end with the CEO: "The best organizations create thousands of leaders," he says. To help spread his leadership around, Chenault travels to different AmEx offices around the world a few times a year and holds brown bag lunches with small groups of lower-tier employees. "The physical presence of a leader is important. It shows the organization, no matter how large, cares about its [employees]," he says.

To further connect personally with his staff, he runs an open operation where anyone can talk to him. "I reach down to all levels. Any employee who sends me a question, I respond. It may not be 100 lines, but something, and if people know you can be approached, they will come to you," he says.